Previously, our government announced that the price of RON97 will be floated in accordance to the crude oil price and adjustment will be done per month basis. They also justified heavily that the subsidy will be cut so that the saving can be used for other more useful project for country development. However, this is not followed tightly. This is because RON97 had not experience any changes even though the oil price had increase more than 4% (from US$100.29 to US$104.35) last month.
Based on the historical chart, I would say that the weighted average of oil prices for beginning of every month is higher than the previous month in this year, given that oil price were hovering at the upper levels. For our RON97 prices to come down, the market prices need to stay low long enough to make the impact. This is because short 1-day or 2-days dips cannot make any difference if the prices keep on rebounding the next day.
Anyhow, we can wait and see what’re the actions will be taken by our government when the crude price further down in future. I believe that the political situation in the Middle East will be settled down very soon.